Governments have definitely figured out how to make money on air travel. This was the sentiment echoed by European Tour Operator Association executive director Tom Jenkins when asked how he feels about the recent trend in which governments are now imposing all sorts of taxes on air travel.
“More than ever, governments are making a lot money off of taxing air travelers,” the candid ETOA executive director said during an exclusive chat with eTN.
If you have traveled recently, a close examination of your ticket may be in order. Do you really know what you are paying for these days? And, in certain cases, one might be slapped with taxes from numerous countries, such as the below itinerary which traveled from the United States, Canada and United Kingdom:
In US dollar,
Base Fare 228.00
Fuel Surcharge 140.00
Canada Airport Improvement Fee 23.55
US Transportation Tax 30.20
US Agriculture Fee 5.00
US Passenger Facility Charge 4.50
US Federal Customs Fee 5.50
US Flight Segment Tax 6.80
Canada Quebec Sales Tax 1.22
Canada Goods and Services Tax 1.41
UK Passenger Service Charge 29.20
UK Air Passenger Duty 81.67
September 11 Security Fee 2.50
US Immigration User Fee 7.00
Total airfare and taxes 566.55
The actual fare for the above ticket was US$228, but the taxes and surcharges equal to US$338.55 which unfortunately means that the traveler paid most of the actual total price of US$566.55 to taxes and surcharges.
Jenkins is not alone in feeling that something must be done to address the ridiculous scheme of levying all sorts of taxes on air tickets. When asked whether the issue was on the agenda for the United Nations seventeenth General Assembly, recently held in Cartagena, Colombia, Geoffrey Lipman, the assistant secretary general and spokesperson for the United Nations World Tourism Organization, agreed that the gathering was the perfect venue to be discussing the issue. He said, “There is a need to raise the issue and the UNWTO General Assembly is the perfect opportunity for governments to do so.”
However, the excessive air taxing by governments was overshadowed by discussions on what have undoubtedly become the two main challenges that the UNWTO has decided to take on–poverty reduction and climate change.
In Canada, air travelers can expect to pay for the below taxes:
NAV Canada Surcharge: Nav surcharges within Canada are either 9/15/or 20 Canadian dollars (CAD) based on distance. For transborder itineraries, 7.50 CAD/ US$7 each way. This surcharge is collected to cover the fees that Canadian airlines pays to NAV Canada to operate Canada’s Air Navigation systems.
Insurance Surcharge: In order to account for the rising costs of aviation insurance, Air Canada along with other North American carriers have implemented an insurance surcharge. This insurance surcharge is 3 CAD, each way for travel wholly within Canada. (Some exceptions apply).
ATSC: The Canadian Parliament has enacted the Air Travelers Security Charge Act to fund security personnel and security equipment in response to the events of September 11. For domestic itineraries, the ATSC is 5 CAD one-way to a maximum charge of 10 CAD. For transborder itineraries, the ATSC is 8 CAD/US$7 one-way to a maximum charge of 16 CAD/US$14.
Airport Improvement Fees: Many airports in Canada and around the world have implemented Airport Improvement Fees (AIFs). Some Airports collect these fees at the airport at time of departure, other’s are collected at the time of ticketing and are reflected in the additional charges portion in your fare. Canadian Airports that include the AIF on your ticket are as follows: (All amounts in CAD)
In the United States, the below air taxes apply:
For domestic travel,
US Domestic Segment Tax – US$3.40 per flight segment, per passenger. A segment is defined as one takeoff and landing.
US Security – September 11th Security Fee – US $2.50 per flight segment. A segment is defined as one takeoff and landing.
Passenger Facility Charges (PFCs) – Local airports assess Passenger Facility Charges of US $3 to US $18 per passenger. This amount varies by airport.
Alaska/Hawaii – US$7.30 per flight segment, per passenger on certain segments beginning or ending in Alaska or Hawaii.
For international travel,
The US and foreign governments charge additional taxes and fees for international travel. International fares do not include government-imposed taxes/fees of up to US $107. Taxes and fees are subject to change at the discretion of each country’s government and may be adjusted for inflation. You may be required to pay taxes or fees not already collected.
Meanwhile, in February this year, the UK government’s Air Passenger Duty doubled those “taxes, charges, and fees” added to airfares. Air travel within UK and the European Economic Area, which is comprised with the 27 EU countries plus Iceland, Liechtenstein and Norway, means having to pay £10 (US$20). The tax on long-haul flights in economy class increased from £20 to £40 (about US$78.58), while the duty on long-haul flights in business class increased from £40 to £80 (US$141.14).
By no means, the above listing of taxes is complete, as governments increasingly get craftier to devise new taxes. If you know of any other taxes and/or want to share your thoughts on this issue, do write to us via the email address: [email protected]